After months of rumors, Bank of America made it official Wednesday morning, saying it would exit the correspondent mortgage space, where it ranks second nationwide.
Industry officials told ASR's sister publication National Mortgage News that the bank has already contacted potential buyers of the business.
BofA said that if a sale does not come off it will wind down the business. According to NMN and the Quarterly Data Report, the bank is the nation's second largest buyer of closed mortgages with a market share of almost 20%.
A company spokesman told NMN that it intends to stay in the warehouse lending space.
Rumors that BofA would exit the correspondent channel first surfaced in March. A handful of mortgage executives said they have been receving a steady flow of resumes from the bank's correspondent group in recent weeks. “I interviewed someone the other day,” said one competing lender.
“As part of our ongoing activities to align the Bank of America Home Loans business to the bank's customer-driven strategy, we have made the decision to exit the correspondent mortgage lending division,” the company said. “We intend to sell the correspondent mortgage lending division or, if a suitable deal is not identified, we will consider other options, including winding down the correspondent lending business in an orderly manner. At this time, our correspondent lending operations continue business as usual.”
Over the past year BofA has shuttered its wholesale mortgage division, stopped making reverse loans, and laid off thousands of account executives and back office processors.
It also is currently trying to sell $80 billion worth of mortgage servicing rights.